N.A.R., Inc. v. Eastern Outdoor Furnishings A/K/A JC Partners, LLC, ___ N.J. Super. ___ (App. Div. 2025). This opinion by Judge Sabatino is an example of a party that “won the battle but lost the war.” Defendant/third-party plaintiff Eastern Outdoor Furnishings (“Eastern Outdoor”) asserted that third-party defendant AMD Direct, Inc. (“AMD”) violated the New Jersey Franchise Practices Act, N.J.S.A. 56:10-1 et seq. (“NJFPA”), in terminating Eastern Outdoor’s alleged franchise to sell AMD’s products. The Law Division granted summary judgment to AMD, holding that there was no written agreement that established a franchise relationship.

Eastern Outdoor appealed to the Appellate Division, arguing that the NJFPA did not require a “written agreement” in order to create a franchise relationship, but only a “written arrangement.” Applying de novo review to that legal issue, Judge Sabatino agreed with Eastern Outdoor in that regard. “N.J.S.A. 56:10-3(a) more flexibly defines a franchise to consist of a ‘written arrangement’ that also meets various other requirements.”

Elaborating on that conclusion, Judge Sabatino said the panel agreed with Eastern Outdoor that “the NJFPA’s use of the term ‘written arrangement’ in N.J.S.A. 56:10-3(a) conveys that a fully integrated and comprehensive written franchise agreement does not have to be executed to create a franchise under New Jersey law. Instead, a series of documents can suffice, provided they are documents in which the franchisor has granted the franchisee ‘a license to use a trade name, trade mark, service mark, or related characteristics,’ and also in which there is a ‘community of interest in the marketing of goods or services.’ Ibid. In addition, the fulfillment of requirements of a New Jersey place of business and the numerical gross sales criteria set forth in N.J.S.A. 56:10-4 must also be established.” AMD’s argument to the contrary was based on Finlay & Associates, Inc. v. Borg-Warner Corporation, 146 N.J. Super. 210 (Law Div. 1976), aff’d, 155 N.J. Super. 331 (App. Div. 1978), which Judge Sabatino found distinguishable.

But the panel ultimately held that Eastern Outdoor did not satisfy the requirements of showing a “written arrangement.” To meet that standard, Eastern Outdoor cited invoices, various e-mail messages, websites and a letter that referred to Eastern Outdoor as “point of contact, distributor, Director of Sales, or the like,” and other documents that “reflect the history of the parties’ business relationship and Eastern Outdoor’s role as a wholesale distributor.” But nothing in those documents “satisfy[ied] the NJFPA’s requirement of a writing in which AMD ‘grant[ed] . . . a license to [Eastern Outdoor] to use [its] trade name, trade mark, service mark, or related characteristics.’ N.J.S.A. 56:10-3(a).” That was fatal to Eastern Outdoor’s claim.

The panel thus affirmed the Law Division’s grant of summary judgment, though on different grounds than the one on which that court relied. But because “the trial court’s decision lacks any analysis of Eastern Outdoor’s non-statutory claims of tortious interference and indemnification,” the panel remanded “for the limited purpose of requiring the trial court to adjudicate those claims with adequate reasons.”